White House reiterates veto threat on Defense spending bill

Final Pentagon spending levels remained in limbo Monday, as the Bush administration restated a threat to veto the fiscal 2007 Defense appropriations bill if it is cut more than $4 billion below its request.

A meeting between Office of Management and Budget Director Rob Portman, House Appropriations Chairman Jerry Lewis, R-Calif., and Senate Appropriations Chairman Thad Cochran, R-Miss., ended in a stalemate Monday evening, with Portman telling the chairmen the White House could not accept their proposal to trim base fiscal 2007 Defense accounts -- excluding emergency war-fighting funds -- by $5.9 billion.

That is the cut Lewis and Cochran agreed to last week, in part to add back money for domestic accounts like education and health care that GOP moderates are demanding, while staying within an $872.8 billion overall fiscal 2007 discretionary budget cap.

"We have a longstanding position on this," Portman said after the meeting, noting prior Statements of Administration Policy on the different House and Senate versions of the Defense spending bill. "We've been very clear and we just sort of reiterated what we've said [all] along, which is we want to protect that base as much as possible."

The House initially cut $4 billion from the White House request, while the Senate cut $9 billion, prompting the veto threat if appropriators agreed to any deeper cuts than the House allotted.

"We just think it's crucial to protect the base, and the Appropriations chairmen totally understand that and we're trying to work with them to do the best we can," Portman said.

Republican aides said House GOP leaders are more inclined to back the Bush administration position than the compromise Lewis-Cochran funding level.

But appropriators want to shift more money from defense to domestic programs in part to accommodate House leaders' promise of more education and healthcare spending.

Even with their compromise on a cut, Lewis and Cochran are still proposing a base of $375.5 billion in Defense appropriations that increases spending by $17 billion over the current fiscal year.

And that does not take into account tens of billions in extra war-related spending for Iraq and Afghanistan the White House has apparently blessed.

White House officials told appropriators Monday that they want war funding under the continuing resolution Congress must pass by the end of this month to correlate to the Senate-passed $64 billion "bridge fund" level, not the lower of House- or Senate-passed levels as the CR will dictate for other government programs.

The bridge fund is expected to rise to $70 billion once Defense spending negotiations are complete. "I think cooler heads will eventually prevail," a GOP aide said.

Conferees on the Defense spending bill might be named this week, with the goal of a formal conference meeting also taking place this week before floor action next week before adjournment.

But Lewis said he detected no softening of the White House position, which was cause for concern.

"I would say that if they want to draw a line in the sand, they probably ought to talk to their team players about it before they do that. It's a difficult point in the negotiations, but I would hope people are very careful about drawing lines in the sand," Lewis said.

When asked if he still thought the Defense appropriations bill could be finished before lawmakers leave town at the end of the month, Lewis added: "I hope so. It's not 100 percent."

Cochran is in an even more difficult position than Lewis, facing pressure from Senate Labor-HHS Appropriations Subcommittee Chairman Arlen Specter, R-Pa., to back additional social spending.

Specter is seeking signatures on a letter to Cochran and Majority Leader Frist urging them to include more money when the final Labor-Health and Human Services spending bill is negotiated.

Even after shifting $9 billion from Defense to domestic programs, Cochran was only able to allocate $5 billion above the White House request to Labor-HHS accounts.

The smaller shift will make it even more difficult to round up the additional $2 billion Specter is seeking to bring education and healthcare programs back to inflation-adjusted fiscal 2005 levels.

"I hope we'll be able to work out a bill that the president can sign. We're just negotiating, and we'll keep on negotiating," Cochran said after the meeting with Portman and Lewis.